In late March of 2018, the IRS announced new rules and deadlines for pre-approved defined benefit plans. The new announcement requires that all defined benefit plans using pre-approved plan documents restate their plan before April 30th of 2020. The previous deadline was January 31, 2019.
Any plans using pre-approved restatement plan documents will need to officially adopt the plan document to comply with IRS regulations. If your plan was eligible for the six-year amendment cycle beginning in 2012, you will need to act to adopt your plan documents before the new deadline. The updated deadline also presents an opportunity to amend the plan or make plan design changes.
What Is Plan Restatement?
The plan restatement process is the way that the IRS requires employers to keep pre-approved plan documents in compliance with legislative and regulatory changes. Because there have been so many changes in recent years, it’s important to review your plan documents to make sure they are complying with current rules.
What Should Plan Advisors and Employers Do?
The plan restatement deadline is an ideal time to review the plan documents as well as the plan design to make any necessary amendments to the plan. Employers and plan advisors should meet to review the existing plan document, any existing plan amendments, and to consider any plan changes they’d like to make.
What Happens During a Plan Restatement?
If your plan requires restatement, your document provider should notify you and give you an idea of when your restatement will happen. They should include a draft of the updated restatement documents and allow you a 30 to 60-day window to review the documents, ask questions, and request any plan changes.
Once the final documents are approved, they will be signed and a formal plan document, copy of the IRS opinion letter for the plan, potentially a trust agreement, and updated Summary Plan Description will be filed with the IRS.
How to Learn More
If you have questions about your specific plan or would like to learn more about the restatement process and deadline, email me today at firstname.lastname@example.org.
About Kenny Phan
Kenny Phan is a Managing Partner at FinancialFocus Retirement Plan Services, a 3(16) fiduciary. He works as a pension specialist who partners with financial professionals to design and implement pension plans. His area of expertise is customized defined benefit, defined contribution, and 401(k) plans. Serving financial advisors and businesses in the greater Phoenix area, he is supported by FinancialFocus Retirement Plan Services. Together, they provide comprehensive plan design consultation, administration, document installation, compliance testing, as well as IRS and DOL reporting for qualified retirement plans.